What is General Average : What Importers and Cargo Owners Need to Know

A maritime accident can have financial consequences far beyond the physical damage to a vessel or its cargo. The recent fire incident involving the container vessel HMM PLATINUM (IMO: 9637155) has once again brought an important principle of international maritime law into focus: General Average (GA).

Following the incident, HMM officially declared General Average, requiring cargo interests to provide both Salvage Security and General Average Security before their cargo can be transshipped, discharged, or released, as applicable.

For international importers, this raises several important questions: What is General Average? Why are cargo owners required to contribute even when their goods remain undamaged? What documents must be submitted? And how can marine cargo insurance help reduce financial exposure?

Understanding these requirements is essential for anyone involved in international ocean freight.

1. HMM PLATINUM Fire Incident: General Average Officially Declared

The container vessel HMM PLATINUM (IMO: 9637155) was involved in a fire incident while sailing from Kattupalli, India, to Santos, Brazil.

Following the incident, emergency response and professional salvage operations were arranged to protect the vessel and the cargo on board. The vessel subsequently proceeded toward South Africa for further arrangements.

On November 6, 2026, HMM officially declared General Average in connection with the incident.

Korhi Average Adjusters & Surveyors Ltd was appointed to handle the General Average adjustment, while Korhi and Richards Hogg Lindley were appointed to coordinate the collection of the relevant security documents.

As a result, cargo owners may be required to provide both General Average Security and Salvage Security before their cargo can proceed through the relevant transshipment, discharge, and release procedures.

This development is particularly important for importers whose containers were on board the affected vessel.

Even if their goods have not suffered any direct physical damage, cargo owners may still face additional financial obligations and cargo release requirements.

2. What Is General Average in Maritime Shipping?

General Average is a long-established principle of maritime law.

It applies when an extraordinary sacrifice or expenditure is intentionally and reasonably made to protect a vessel, its cargo, and other interests involved in a common maritime adventure from a shared danger.

In simple terms, when a vessel encounters a serious emergency at sea, certain extraordinary expenses incurred to save the vessel and the cargo on board may be shared proportionally among the relevant interests.

For example, imagine a container vessel experiences a serious fire while sailing.

To prevent the fire from spreading and protect the vessel and the remaining cargo, emergency measures may include:

• Arranging professional firefighting operations.
• Engaging professional salvage teams for emergency assistance.
• Diverting the vessel from its original route to a port of refuge.
• Unloading, handling, and temporarily storing containers.
• Carrying out emergency repairs and other necessary protective measures.

Where these expenses qualify under the applicable maritime rules, they may be included in the General Average adjustment.

Rather than placing the entire financial burden on the shipowner, eligible expenses are distributed among the relevant contributing interests according to their respective contributory values.

General Average adjustments are commonly governed by the York-Antwerp Rules, which provide an internationally recognized framework for determining qualifying expenses and allocating contributions among the parties involved.

3. Why Must Cargo Owners Contribute Even If Their Goods Are Undamaged?

This is probably one of the most confusing aspects of General Average for many importers.

A common question is:

“If my container was not affected by the fire, why should I have to pay?”

The answer lies in the fundamental principle of General Average: the sharing of extraordinary expenses incurred to protect the common maritime adventure.

Under General Average, the obligation to contribute is not determined solely by whether an individual container has suffered physical damage.

Even if a container has not been burned or exposed to seawater, its cargo owner may still be required to contribute, provided the cargo was involved in the common maritime adventure and the relevant expenses qualify under the applicable rules.

For example, if emergency firefighting, professional salvage assistance, or a diversion to a port of refuge was necessary to protect the vessel and the cargo on board, qualifying expenses may be shared among the relevant interests.

These expenses may include:

• Professional salvage costs and emergency assistance.
• Firefighting operations and related emergency expenses.
• Port of refuge expenses.
• Necessary cargo unloading, handling, and storage costs.
• Other qualifying extraordinary expenses incurred to preserve the vessel and cargo.
• Allowable expenses associated with the General Average adjustment process.

The key principle is that General Average is based on the shared protection of the maritime adventure, not simply on whether an individual container has suffered physical damage.

However, not every expense arising from a maritime accident automatically qualifies as General Average. The appointed average adjuster must review the circumstances and determine which expenses are recoverable under the applicable rules.

4. Who Is Responsible for Paying General Average?

General Average contributions may involve several parties whose interests were protected during the maritime emergency.

Shipowners

The shipowner contributes based on the contributory value of the vessel and other relevant interests.

Cargo Owners

Cargo owners may be required to contribute according to the assessed contributory value of their cargo.

Contributions are generally calculated according to the proportion of each interest’s contributory value relative to the total contributory value.

For example:

If the total adjusted General Average expenses amount to USD 1,000,000, and a particular cargo interest represents 5% of the total contributory value, its indicative contribution would be USD 50,000.

This is a simplified illustration only. The actual amount payable will be determined by the appointed average adjuster after reviewing the eligible expenses, valuations, and applicable maritime rules.

Importantly, General Average is not an equal charge per container. Each contributing party’s share is calculated according to its respective contributory value.

5. Cargo Release Requirements: General Average and Salvage Security

One of the most important issues following the HMM PLATINUM incident is the requirement for cargo owners to provide both General Average Security and Salvage Security.

These are two separate security requirements and must be addressed in accordance with the instructions issued by the relevant parties.

If your cargo is on board the affected vessel, you should receive a General Average Declaration Notice from the shipping company.

The notice will generally explain the procedures for insured and uninsured cargo, as well as provide information about the designated average adjuster’s website, where case updates and cargo release information can be checked.

A. For Cargo Owners with Marine Cargo Insurance

If your cargo is covered by a valid marine cargo insurance policy, you should contact your insurance company immediately.

The following documents are generally required:

1. General Average Bond (Average Bond)

To be completed and signed by the cargo owner.

2. General Average Guarantee (Average Guarantee)

To be completed and signed or stamped by the cargo insurer.

Please note that this document must be completed and signed or stamped by the insurance company. It must not be signed by the cargo owner on behalf of the insurer.

3. Copy of the Commercial Invoice

A copy of the commercial invoice must be provided.

If the commercial invoice does not include the ocean freight amount, the relevant freight details should also be submitted.

Once completed, the General Average documents should be emailed to the designated average adjuster’s email address specified in the shipping company’s notice.

Important: All email correspondence should clearly state the vessel name, container number, and Bill of Lading (B/L) number to ensure proper identification and processing.

The cargo insurer may issue the General Average Guarantee and arrange the required salvage security, subject to the insurance policy terms and the acceptance requirements of the relevant parties.

In most cases, insured cargo owners can satisfy the security requirements through guarantees issued by their insurance company without making an immediate cash deposit themselves.

However, cargo owners should confirm that their insurance coverage is valid and that the guarantees issued by their insurer are acceptable to the relevant parties.

B. For Cargo Owners Without Marine Cargo Insurance

For cargo owners who have not purchased marine cargo insurance, cash security may be required to satisfy the General Average and salvage security requirements.

The following documents must generally be provided:

1. General Average Bond (Average Bond)

To be completed and signed by the cargo owner.

2. Copy of the Commercial Invoice

A copy of the commercial invoice must be submitted.

If the commercial invoice does not include the ocean freight amount, the relevant freight details should also be provided.

3. Cash Security Deposit

For uninsured cargo, a cash deposit may be required in place of the insurance company’s General Average Guarantee.

The detailed cash security requirements and payment instructions will be provided separately by the appointed average adjuster.

Further instructions and the latest case updates will be published and updated on the dedicated incident page of the average adjuster’s website.

Without the required security, the relevant cargo may not be released or forwarded.

This may result in:

• Delays in cargo collection and final delivery.
• Additional port storage and handling charges.
• Potential demurrage, detention, and other related expenses.
• Unexpected cash flow pressure for importers.

Therefore, marine cargo insurance is not only intended to protect goods against physical damage. It also plays an important role in managing financial obligations arising from unexpected maritime incidents.

C. FCL Cargo Delivery Arrangements

For Full Container Load (FCL) shipments, cargo can only be collected after the relevant cargo interests have provided the required General Average Security.

Once the security requirements have been satisfied, the relevant containers will be added to the official cargo release list.

This list will be published on the appointed average adjuster’s dedicated website and updated daily.

Once a cargo owner’s container appears on the published release list, the cargo owner can follow the original procedures and contact the shipping company or its local agent to arrange cargo delivery.

Important: Being listed on the release list indicates that the relevant General Average security requirements have been satisfied for the container. Cargo owners should still follow the shipping company’s normal delivery procedures and confirm whether any other outstanding requirements apply.

D. LCL / Groupage Cargo Delivery Arrangements

For Less than Container Load (LCL) or groupage shipments, additional cargo information is required to identify the individual shipments inside the affected containers.

Freight forwarders handling LCL cargo should provide a complete cargo manifest for the relevant groupage containers as soon as possible.

The manifest should include:

• Bill of Lading numbers.
• Cargo descriptions.
• Cargo weights.
• Shipper information.
• Consignee information.

Providing complete and accurate cargo details will help the relevant parties identify individual cargo interests and facilitate the subsequent General Average security and release procedures.

Why Can Undamaged Cargo Still Be Held?

Cargo release is not determined solely by whether the goods have suffered physical damage.

Even if the cargo inside a container remains completely intact, the cargo owner may still need to provide the required General Average and salvage security before the relevant parties authorize release or forwarding.

This means that undamaged cargo can still face delivery delays if the required security procedures have not been completed.

For importers, this is an important operational risk that should not be overlooked.

6. General Average Adjustment: Why Does the Final Contribution Take So Long?

Another important point is that the final General Average contribution is not necessarily determined immediately after an incident.

Once General Average is declared, the appointed average adjuster must review the relevant expenses and assess the contributory values of the parties involved.

The adjustment process generally includes:

1. Collecting information about the vessel incident and emergency response operations.
2. Reviewing salvage expenses, port of refuge costs, and other potentially allowable expenditures.
3. Assessing the contributory values of the vessel, cargo, freight, and other relevant interests.
4. Determining which expenses qualify under the applicable General Average rules.
5. Calculating the contribution payable by each participating interest.
6. Preparing the official General Average Adjustment Report.

When an incident involves a large container vessel carrying cargo belonging to numerous different parties, together with complex salvage operations, the adjustment process can take a considerable amount of time.

Consequently, cargo owners may be required to provide security before the final contribution amount has been established.

It is important to understand that the security amount or cash deposit is not necessarily the same as the final General Average contribution.

The final financial responsibility will be determined by the official General Average Adjustment Report, with any applicable deposits subsequently reconciled in accordance with the relevant procedures.

7. Does Marine Cargo Insurance Cover General Average?

For importers, this is one of the most important questions to consider before arranging an ocean shipment.

Many properly structured marine cargo insurance policies cover General Average contributions and salvage charges, subject to the policy wording, insured value, exclusions, and applicable conditions.

When a shipping company declares General Average, cargo insurers may assist with:

• Reviewing the General Average Declaration and supporting documents.
• Issuing an acceptable General Average Guarantee.
• Arranging or evaluating the required salvage security.
• Coordinating with the average adjuster and relevant parties.
• Handling eligible claims in accordance with the insurance policy.

However, not all insurance policies provide identical protection.

Cargo owners should carefully review their insurance coverage, including the applicable Institute Cargo Clauses, insured value, exclusions, and any special conditions.

For uninsured shipments, cargo owners may need to provide cash deposits or other acceptable forms of security directly.

Our recommendation: Always confirm that your marine cargo insurance covers General Average contributions and salvage expenses before your goods are loaded onto a vessel.

8. How Can Importers Reduce Their Exposure to General Average Risks?

General Average is an established part of maritime transportation. Although importers cannot completely eliminate the possibility of a vessel casualty, they can take several practical steps to reduce financial uncertainty and operational disruption.

1. Arrange Appropriate Marine Cargo Insurance

Do not focus solely on ocean freight rates. Before arranging a shipment, confirm that your insurance policy provides appropriate coverage for General Average contributions and salvage expenses.

2. Understand Your Incoterms Responsibilities

The agreed Incoterm determines important responsibilities between buyers and sellers, including the allocation of transportation costs and risks during shipment.

However, Incoterms do not automatically remove the rights of shipowners or other maritime interests under applicable maritime law.

3. Keep Shipment Documentation Organized

Maintain copies of commercial invoices, packing lists, Bills of Lading, insurance certificates, and other relevant shipping documents.

These documents may be required during the General Average adjustment and security process.

4. Maintain Communication with Your Freight Forwarder

If a vessel incident occurs, timely communication is essential.

Importers should confirm the vessel’s status, cargo condition, revised delivery arrangements, and any additional documentation or security requirements.

Early coordination can help minimize unnecessary delays and avoid confusion during the cargo release process.

9. Final Thoughts: General Average Is a Risk Every Ocean Freight Importer Should Understand

The HMM PLATINUM fire incident is another reminder that international ocean freight involves risks beyond ordinary freight charges and transit times.

A vessel fire, collision, grounding, or other serious maritime emergency can trigger a General Average declaration, potentially creating unexpected financial obligations for cargo owners.

Most importantly, cargo does not need to suffer physical damage for its owner to be required to contribute to qualifying General Average expenses.

For importers, understanding General Average is not simply a matter of maritime terminology. It is an essential part of shipment risk management, marine cargo insurance planning, and international supply chain management.

At LINKWAY FREIGHT LIMITED, we understand that reliable international logistics services involve more than simply arranging vessel space. Keeping customers informed about shipping developments, potential transportation risks, and operational requirements is equally important.

We provide ocean freight solutions from China and Southeast Asia to the United States and Canada, including port-to-port, port-to-door, destination customs clearance, and final delivery services.

Whether you are planning your next ocean shipment or dealing with unexpected shipping disruptions, our team is ready to assist with practical logistics support and shipment coordination.

Contact LINKWAY FREIGHT LIMITED for professional ocean freight solutions and reliable shipping support.